Special Reports

CSP spend on edge compute infrastructure will grow at a 76.5% CAGR to over $67B in 2023

According to TBR’s 2Q19 Telecom Edge Compute Market Landscape, cost optimization of the network is the primary initial justification for CSPs to build out edge compute infrastructure, with new revenue from low latency use cases expected to materialize in a few years. This initial edge build-out will lay a foundation for CSPs to support new business models as they emerge, particularly as it pertains to low latency services.

Cost savings from the use of edge sites stem from infrastructure
virtualization and real estate footprint consolidation as well as bandwidth
optimization. One of the key areas of cost savings for CSPs is
the use of white-box hardware in their virtualized networks. According to TBR’s
research, white-box hardware can cost up to 50% less than black-box hardware.
This represents significant cost savings to CSPs that adopt white boxes at
scale. Webscales already widely use white boxes in their central data centers,
and leading CSPs such as Rakuten, AT&T, Verizon and Telefonica are
beginning to build their edge sites using almost exclusively white boxes. The
use of white boxes will make it economically feasible for the capillary network
to be built out, as cost feasibility is one of the primary inhibitors to edge
build-outs.

CSPs are in the experimentation phase of testing new business models that leverage edge compute, with low latency services being the focus area. Though there are myriad potential use cases that would require low latency connectivity, such as connected transportation and AR/VR gaming, the business case remains unclear and the theoretical investment to enable and support said use cases is high. TBR believes it will take a few more years before new revenue-generating use cases for the network that require edge compute become commercialized and begin to contribute to CSPs’ revenue.

Strong investments by webscales and China-based telcos will carry the telecom infrastructure services (TIS) market through the COVID-19 crisis relatively intact, with a shallow decline of relatively short duration expected in the overall market followed by a robust, sustained recovery as CSPs in other key countries accelerate their infrastructure initiatives to align with the new […]

Strong investments by webscales and China-based telcos will carry the telecom infrastructure services (TIS) market through the COVID-19 crisis relatively intact, with a shallow decline of relatively short duration expected in the overall market followed by a robust, sustained recovery as CSPs in other key countries accelerate their infrastructure initiatives to align with the new […]